Concept of materiality in audit
The concept of materiality should be applied from planning and performing of an audit. Information is of high significance if its omission or misstatement will influence the economic decision of the user of the financial statements.
Often misstatements are considered significant if individually or in aggregate they could reasonably be expected to influence the economic decisions of users taken on the basis of financial statements.
Judgments about materiality are made in the light of surrounding circumstances and are affected by the auditor’s perception of financial information needs of users.
The auditor’s opinion is deals with financial statements as a whole and therefore the auditor is not responsible for the detection of misstatements that are not if impacting significance to the financial statements as a whole.
In all cases where reasonable assurance cannot be obtained a qualified opinion is given in auditors report saying that he did not obtain a reasonable assurance that the financial statements are free and fair.
Misstatement of material figures may alter auditor's opinion.